You should not be gambling with high costs and low returns, so how do you narrow the gap between cost and return when moving into new markets?
Resellers need to commit to the vendor with the aim of securing accreditation and agreeing on a joint business plan. In return, you should get access to vendor partner portals and a clear view of who does what at both the vendor and distributor. Who is accountable, and for what?
Within the first month of engagement, a training schedule, formal accreditation, and technical enablement of the pre-sales force should be in place. It is in the vendor’s best interest to ensure you are up to speed with new products, and ready to tackle emerging opportunities – particularly with existing customers.
The inherent cost of developing a pipeline and a capable sales channel needs to be carefully considered but that risk should decline as sales models and reputation are established.
Work closely with your distributor to develop a sustainable, profitable business model with a firm foundation of sales expertise. This is critical if you want healthy profits.
Build strong partnerships over time
When a partnership is new, you need to develop trust. The first month is a ‘getting to know you’ period and the distributor should act as enabler, ensuring all parties are committed to closing sales. Partners need to understand that vendors and resellers will have separate requirements, but if they are willing to accept this and fully commit to a trial period of no less than three months, you can start earning from new opportunities.
Resellers should also at this point have nominated the salespeople who are able to deliver a more in-depth vendor pitch. This lets partners gauge the effectiveness and state of vendor training and plan for additional support where needed.
At this stage, you also need to create your own value proposition around the vendor’s offering. A good start is to compare it with your own top account list, using the knowledge you already have to identify complementary sales opportunities.
This is an activity the vendor sales force can support and the distributor should also be actively engaged.
After three months, the distributor, vendor and reseller should be able to evaluate progress. Markers for this should be agreed in advance, of course. Staff should by now have received sufficient training to understand the new portfolio and be able to deliver the vendor’s preferred pitch to selected customers.
Assessing your progress as you go means that things can be changed if necessary mid-stream, avoiding wasting money or other resources.
Any new business arrangement and engagement is bilateral. A distributor can liaise with the vendor on your behalf and directly drive sales, not just with lead generation, but by helping close new sales – countering the risk of investing in new opportunities.
Ed Callacher is divisional manager for networking and security at Bell Micro
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